Small Business Tax Deductions: The Complete List

Mileage is one of the largest deductions for many small businesses, but the full Schedule C list is much longer. Here are the major categories.

Vehicle expenses

Either standard mileage rate (72.5¢/mile in 2026) or actual expenses times business-use percentage. Method comparison guide.

Home office

Simplified method: $5/square foot up to 300 sq ft (max $1,500). Actual expense method: business-use % of mortgage interest or rent, utilities, insurance, repairs, depreciation. Requires qualifying home office.

Phone and internet

Business-use percentage of monthly bills. A dedicated business line is fully deductible.

Health insurance (self-employed only)

Premiums for yourself, spouse, dependents are deductible above-the-line. Limited to net Schedule C income, not available if you have employer-sponsored coverage option through a spouse.

Retirement contributions

SEP-IRA (up to 25% of net self-employment income), Solo 401(k) (up to $23,500 employee + 25% employer in 2026), SIMPLE IRA. All deductible above-the-line.

Professional services

• Accounting and tax prep (business portion)
• Legal fees
• Consulting fees
• Bookkeeping software subscriptions

Marketing and advertising

• Business cards, flyers, branded materials
• Online ads (Google, Facebook, App Store ads if you ship apps)
• Website hosting and domain renewals
• SEO and content marketing fees
• Social media management tools

Office supplies and equipment

• Pens, paper, printer ink
• Postage and shipping
• Computers and tablets (depreciated or via Section 179)
• Software subscriptions

Travel

Business-trip airfare, lodging, 50% of meals, ground transportation, conference fees. Different rules from regular mileage. Schedule C, line 24.

Continuing education

Books, courses, training that maintain or improve skills used in your existing business. Education that qualifies you for a new career does NOT deduct.

Insurance

• Business liability insurance
• Errors and omissions insurance
• Commercial auto insurance (separate from personal auto)

Bank fees and interest

• Business credit card annual fees
• Interest on business loans
• Merchant processing fees (Stripe, Square, PayPal)

What does NOT deduct

• Personal expenses with no business purpose
• Commuting from home to a regular workplace
• Clothing that could be worn off the job
• Traffic/parking tickets
• Fines and penalties
• Lobbying or political contributions

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